Question

Discuss 5 reasons of disadvantages of merger and acquisition

Answer 1

Ans:

Disadvantages of merger and acquisition:

1. Loss of experience workers in the organization from leadership position. This kind of loss makes an organization value down and business understanding also get reduced among employees.

2. Employees of the small merging companies may require to do exhaustive re-skilling after Merger and acquisition done.

3. Company will face major difficulties due to internal competition that may occur among the staffs of the merged companies and it also creates risk of getting surplus employees in some departments.

4. Merging firms that are doing similar works that could mean repetition of same work and over capability within the organization that may need retrenchments and waste of resources.

5. Increase in costs might results bad for company if the right management of modification and the implementation of the M&A dealing are delayed.